Is Oppenheimer Developing Markets Y (ODVYX) a Strong Mutual Fund Pick Right Now?
If you have been looking for Non US - Equity funds, it would not be wise to start your search with Oppenheimer Developing Markets Y (ODVYX). ODVYX possesses a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
Zacks categorizes ODVYX as Non US - Equity, a segment stacked high with options. Non US - Equity mutual funds like to invest in companies outside of the United States, an important characteristic since global mutual funds are known to keep a good portion of their portfolio stateside. These kinds of funds can often extend across all cap levels, and will typically allocate their investments between emerging and developed markets.
History of Fund/Manager
Invesco is based in Kansas City, MO, and is the manager of ODVYX. The Oppenheimer Developing Markets Y made its debut in September of 2005 and ODVYX has managed to accumulate roughly $22.73 billion in assets, as of the most recently available information. The fund is currently managed by Justin Leverenz who has been in charge of the fund since May of 2007.
Performance
Investors naturally seek funds with strong performance. ODVYX has a 5-year annualized total return of 9.78% and it sits in the middle third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 9.21%, which places it in the bottom third during this time-frame.
When looking at a fund's performance, it is also important to note the standard deviation of the returns. The lower the standard deviation, the less volatility the fund experiences. Compared to the category average of 16.14%, the standard deviation of ODVYX over the past three years is 19.1%. The fund's standard deviation over the past 5 years is 16.21% compared to the category average of 13.47%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. ODVYX has a 5-year beta of 0.8, which means it is likely to be less volatile than the market average. Because alpha represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which is the S&P 500 in this case, one should pay attention to this metric as well. ODVYX's 5-year performance has produced a negative alpha of -3.01, which means managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Expenses
Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, ODVYX is a no load fund. It has an expense ratio of 0.95% compared to the category average of 1.18%. ODVYX is actually cheaper than its peers when you consider factors like cost.
While the minimum initial investment for the product is $1,000, investors should also note that each subsequent investment needs to be at least $50.
Bottom Line
Overall, Oppenheimer Developing Markets Y ( ODVYX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, this fund looks like a somewhat weak choice for investors right now.
Don't stop here for your research on Non US - Equity funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare ODVYX to its peers as well for additional information. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.
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